'An Industry of Survivors’ Prepares to Gather in Dallas for HELI-EXPO

With the world’s largest gathering of helicopter professionals just a week away, and an industry facing challenges, we decided to ask a true rotorcraft expert for some perspective. When it comes to this industry, Helicopter Association International (HAI) President Matt Zuccaro has seen and done it all. He started his career as a U.S. Army aviator and has decades of experience in nearly every aspect of rotorcraft operations. Here’s what we discussed in advance of HAI HELI-EXPO 2017.

Let’s start by talking about the health of the rotorcraft industry. We know the industry is hurting — but how bad is it?

MZ: Lower oil prices have led to a reduction in offshore activities, meaning oil and gas exploration and production. It is impacting operators, and the entire industry is aware of it. There have been layoffs of personnel in that segment and there are aircraft that are laid up on ramps and not flying. But then it has a domino effect in the sense that the operators just prior to this were updating and expanding their fleets, so those orders had to be delayed or in some cases cancelled. And subsequently that affects manufacturers and it affects leasing companies. The operators themselves have done what they had to do in order to sustain themselves and their operations and weather the storm. And I think one of the great things about the helicopter industry is the diversity of the vehicle, in that we have upwards of 55 missions that are done with helicopters. Also, we are an industry of survivors. So when you get a situation like this, a lot of operators will diversify their activities and go into other market segments to keep those aircraft and people busy. We’ve been through these peaks and valleys before, and we always come out stronger and better. Right now, oil prices are starting to rise and activity levels are increasing. We’re in the beginning of a slow recovery, which is good news.

So the industry is in a downturn, but HAI HELI-EXPO attendance is up, and you have indicated that the show in Dallas will be a record breaker. How do you explain that?

MZ: The show has been growing five to six percent a year for the past seven or eight years, and 2017 will be the largest HELI-EXPO ever. I think it’s a reflection of the industry’s desire to take advantage of the business, networking, and educational opportunities, and to get updated on everything that’s going on in the rotorcraft world. And if you have a situation like we ours, where maybe a given segment is not doing well businesswise, it’s all the more reason for people to come to the show and stay engaged. We are very honored that the industry supports us to the extent that they do.

You mentioned that we’re at the very beginning of a slow recovery. What does recovery look like for us? Where will it start? How slow is slow?

MZ:This isn’t a complete downturn of the entire industry.We have a very specific area that’s been affected by the pricing of a very specific product. And the recovery for that obviously is measured by more helicopters flying to support more aggressive oil and gas exploration and a return to the levels of flying and activity we had prior to the downturn. That’s a multi-year process that does not happen overnight. And as I said, the offshore oil industry has been through this before and they know what it looks like and what they have to do. There are some extremely smart individuals out there managing and running these companies and I'm sure they’ll come through it fine, as they have in the past.

We know that the new president is a helicopter owner himself. What impact do you think President Trump may have on our industry?

MZ: Well, it’s kind of ironic because, back in the 1980s, I managed a company that had the contract to manage President Trump’s personal aircraft. And I know from personal experience that he is a big supporter of general aviation and business aviation. He actively uses helicopters and airplanes, and I know he’s a safety-oriented individual, which is always a good thing. Overall, we are optimistic. One area where we appear to differ with the president is on the issue of privatizing the air traffic control system. We oppose removing it from the FAA and placing it under the control of a private corporate entity with a board of directors that is dominated by the airlines. The general aviation community, certainly us included, does not think that is the best solution to any concerns about air traffic.

What about the argument that the government is not efficient or effective enough to take this on successfully?

MZ: Air traffic control in the United States is globally recognized as the safest, most efficient system. It’s one of the most positive segments of the FAA, and our industry enjoys an excellent relationship with the professionals who manage and run the system. We’re concerned that removing it from congressional oversight will not bode well for the helicopter segment, especially in regard to appropriations. We also oppose user fees, because we pay our fair share into the system through the excise tax on fuel and that kind of activity. And when the helicopter industry pays its share, that money goes into projects that tend to be fixed-wing centric, like building an infrastructure to support fixed-wing operations, building runways, or expanding airport infrastructure. We think that the money our helicopter operators pay into the system should be escrowed in a separate account to support a national network of heliports and a dedicated, low-level IFR infrastructure for helicopters to use. Those are some of the things that we’re concerned about.

The convention is just days away. With that in mind, what do you think is most exciting about this year’s event? What do you think is going to be turning heads and drawing crowds? And also, what are you most excited to see and do at the show?

MZ: Well as always, our big gratification, quite frankly, is to be able to provide the environment for 20,000 plus attendees from all over the world to get together and network and learn from each other. Plus, we continue to offer an always-expanding array of great opportunities for everyone.

Is there anything you personally are excited to see? A new product or technology?

MZ: Absolutely. I honestly believe that the unmanned vehicle is a game-changer and this is a watershed moment for us in the industry. Heli-Expo will reflect that. Quite a few unmanned vehicle manufacturers will be exhibiting, and for the first time ever we’ll have demonstrator cages. Attendees can try the vehicles, talk to the manufacturers and learn more about what’s happening. So this is pretty exciting stuff and I'm very interested because I think it’s going to make such a dynamic difference in the helicopter industry and our future. In fact, Wednesday’s general session (8:30-10:30 am in Ballroom D) will focus on what we think are huge business opportunities associated with unmanned aircraft, so you’ll see that we are aggressively addressing this great new technology that’s going to be sharing airspace with us.

Do you have a concern that the unmanned vehicles may supplant the need for the manned operations?

MZ: I happen to be on the Drone Advisory Committee for the FAA DOT representing the helicopter industry. The thing to remember is that these vehicles will conduct their missions at 500 feet or less, which is where we are most of the time. They fly the same missions as us, and they do it in the vertical reference mode hovering, which is where we are. But we don’t look at it as a threat to our industry. We look at this as a great business opportunity to expand our capabilities and services to a new and existing customer base. We are by far the most qualified to offer these services. It’s our airspace, our missions and we are the resident experts in vertical reference hovering. We know all of it better that anyone. So it’s much better for us to be able to go and offer our customers the alternative to consider unmanned vehicles. Because if we don’t, someone else will. And we should be in command of that segment.